What Happens If a Hurricane Damages a Sarasota Home Before Closing?

Why This Question Matters Before You Close

A contract on a Sarasota or Manatee home can run a month or more from signing to closing, and a storm can arrive in that window. Buyers worry about paying for a house that is no longer the one they inspected. Sellers worry about losing the sale or paying for repairs they did not plan on. Both questions have answers in the contract, and most people have never read that section.

This article walks through what the standard FR/BAR contracts say about damage before closing, what happens when a storm delays the closing itself, and why insurance timing is the part that catches people off guard. It is general information, not legal advice. Your own contract, its riders, and an attorney decide your situation.

Who Carries the Risk Between Contract and Closing, and What Happens When the Damage Is Small?

According to a July article by attorney Sarah Ferlazzo of Williams Parker, posted by the Realtors Association of Sarasota and Manatee (RASM), the seller bears the risk of loss until closing under both FR/BAR contracts, and must restore the property to its condition as of the contract’s effective date unless the contract says otherwise. You can read the full piece on the RASM site.

The contract draws a line at 1.5% of the purchase price. Florida Realtors’ explanation says that when the cost to restore the property does not exceed 1.5% of the purchase price, the seller pays for it. As a hypothetical, 1.5% of a $500,000 contract is $7,500. Damage that costs less than that is the seller’s responsibility, the buyer cannot cancel over it, and the sale proceeds (see Florida Realtors on hurricanes and contract clauses).

If the repairs cannot be finished before closing, both sources say the seller escrows 125% of the estimated repair cost. In the same hypothetical, a $5,000 repair estimate would mean $6,250 held back at closing.

What If the Damage Is Bigger Than 1.5%?

When the cost to restore exceeds 1.5% of the price, the buyer gets a choice. Florida Realtors describes the options this way: the buyer can keep the property and take 1.5% of the purchase price, or receive a refund of the deposit and be released from further obligations under the contract. The RASM article describes the same two paths. Neither article we reviewed gives a deadline for making that choice, so check your contract and ask your attorney how quickly you need to decide.

This is also why the final walkthrough matters. Our guide to the final walkthrough covers what to look at, and after a storm you should look for water intrusion, roof damage, and anything that was not there when you first toured. Photos of the home from your inspection give you a record to compare against. Do not rely on memory.

Deposit questions come up quickly in this situation. Our article on how earnest money works in Florida covers how deposits work and what puts them at risk.

What an outstanding group Team Renick is to work with….True professionals throughout the entire process. Their excellent attention to detail and thoroughness put our mind at ease as they protected our interest… What a pleasure!

– Pamela McCrone, Google Review

What If the Storm Delays or Blocks the Closing Itself?

A storm can disrupt a closing even when the home is untouched. The FR/BAR contracts have a force majeure clause for this. According to the RASM article, covered events include hurricanes, floods, extreme weather, fires, and government actions, but the event must actually prevent a party from performing under the contract. Florida Realtors puts it plainly: it takes an unusual and unavoidable event to trigger the clause.

When the clause applies, the affected deadlines, including the closing date, move back by a reasonable time, up to seven days after the event no longer prevents performance. If the event keeps preventing performance for more than 30 days past the scheduled closing, either party may terminate, and the buyer’s deposits are returned, per the RASM article. Those are summaries, and the exact wording in your version of the contract is what counts.

Why Insurance Timing Is the Part Buyers Miss

The RASM article notes that during a storm, insurance carriers may be unable to bind policies, which can keep a closing from happening. Citizens Property Insurance shows what that looks like. A Citizens binding-suspension bulletin quotes its rule: agents may not bind applications for new coverage, or policy changes that increase coverage, regardless of effective date, when the National Weather Service has issued a tropical storm or hurricane watch or warning for any part of Florida. Citizens notes that its current requirements are in its underwriting manuals and agent FAQs, and other insurers set their own rules, so ask your agent how your carrier handles a watch or warning.

Flood coverage has its own clock. FEMA’s NFIP bulletin on policy effective dates lists a standard 30-day waiting period for new policies, and treats a loan closing as a separate category with no waiting period. Because that exception is tied to a loan closing, ask your insurance agent how it applies to your purchase, especially if you are paying cash. Our guide to how Sarasota coastal flood insurance works covers the basics.

Wind-related insurance costs matter too. Our article on wind mitigation reports for Florida buyers covers what buyers should know about that report. Ask for insurance quotes early in the contract period, before a storm forms.

How to Protect Yourself Before You Commit

1. Read the Casualty Loss Section Today: Find the risk of loss language in your contract now, and note the 1.5% line and the 125% escrow terms.
2. Document the Home’s Condition: Keep your inspection report and photos so you can show what the home looked like before any storm.
3. Line Up Insurance Early: Ask your agent for a quote and a binding date as soon as the contract is signed, and ask what happens if a watch or warning is issued first.
4. Ask About Flood Coverage Timing: Ask your insurance agent how the NFIP waiting period applies to your purchase, whether you are using a loan or paying cash.
5. Put Storm Damage Notices in Writing: If damage occurs, tell the other side and the closing agent in writing right away, and follow the contract’s notice steps instead of relying on phone calls.
6. Talk to an Attorney Before You Cancel or Waive Anything: Cancelling, accepting a credit, or agreeing to a new closing date can affect your deposit, so get legal advice first.

Get Help Reading the Contract Before a Storm Forms

At Team Renick, we can explain what the terms say in plain language, help you build a timeline for insurance and closing, and point you to a real estate attorney when the situation calls for legal advice. We serve buyers and sellers across Sarasota and Manatee Counties.

Pull out your signed contract and find the casualty loss and force majeure language. Then call your insurance agent and your lender this week, and ask when coverage can be bound and what they need before closing. If a storm is already forming, talk to your agent and an attorney before you sign anything that changes your deposit or closing date. Call Michael Renick at 941.400.8735 and we will help you sort out the next steps.

About the Author

I’m Michael Renick — a Florida West Coast broker with over 15 years guiding families through some of the biggest decisions of their lives. I’ve built my practice on hard work, honesty, and total transparency. No shortcuts, no spin — just straight answers, deep market knowledge, and the dedication my clients deserve from start to close.

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Equal Housing Opportunity. This article is general information only, not legal, tax, insurance, or financial advice. Market conditions, insurance requirements, and costs vary by property and transaction; confirm your specific situation with the appropriate licensed professional. Michael Renick, Licensed Florida Real Estate Broker, License #BK3241900, licensed by the Florida Department of Business and Professional Regulation (DBPR). Mangrove Realty Associates Inc — each office is independently owned and operated.

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